The High Court allowed the Income Tax Appellate Appeal where the Tribunal rejected the contention that an assessment order against a merged entity was invalid. The Court answered substantial questions of law in favor of the assessee.
The substantial questions of law are answered in favor of the assessee and against the revenue.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 1ST DAY OF AUGUST, 2022
PRESENT
THE HON’BLE MR. JUSTICE P.S. DINESH KUMAR
AND
THE HON’BLE MRS. JUSTICE M.G. UMA
I.T.A NO.1008/2017
BETWEEN:
LOGICA PVT. LTD., (MERGED WITH CGI INFORMATION SYSTEMS AND MANAGEMENT CONSULTANTS PVT. LTD.,) ELECTRONIC CITY TOWER II, NO.95/1 AND 95/2, ELECTRONIC CITY PHASE I (WEST) BANGALORE - 560 100 REPRESENTED HEREIN BY ITS DIRECTOR MS. BABALUSHA ESTHER ALEXANDER. PAN NO. AAACL5372K
.…APPELLANT
(BY SRI: T. SURYANARAYANA, SENIOR COUNSEL FOR SMT: TANMAYEE RAJKUMAR, ADVOCATE)
AND:
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KORAMANGALA 6TH BLOCK BANGALORE - 560 085.
…RESPONDENTS
(BY SRI: K.V. ARAVIND, ADVOCATE)
THIS ITA IS FILED UNDER SECTION 260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 05.07.2017 PASSED IN IT(TP)A NO.1371/BANG/2010, FOR THE ASSESSMENT YEAR 20062007, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE, ALLOW THE APPEAL AND SET ASIDE THE ORDER OF THE TRIBUNAL DATED 05.07.2017 PASSED IN IT(TP)A NO.1371/BANG/2010 (ANNEXURE-G) AND PASS SUCH OTHER OR SUITABLE ORDERS AS THIS HON'BLE COURT DEEMS FIT TO PASS ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE AND EQUITY.
THIS ITA COMING ON FOR FINAL HEARING , THIS DAY, P.S.DINESH KUMAR, J., DELIVERED THE FOLLOWING:
JUDGMENT
Heard Shri T Suryanarayana, learned senior advocate for the appellant-assessee and Shri K V Aravind, learned advocate for the Revenue.
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order before the Dispute Resolution Panel (for short 'DRP'). By its order dated 16.09.2010, the DRP rejected the objections filed by LPL and directed the Assessing Officer to compute the loss as per the draft assessment order. The Assessing Officer passed the assessment order on 23.09.2010 against LGSPL. The appellant challenged the said order before the Income Tax Appellate Tribunal (for short 'ITAT') in IT(TP)A No.1371/Bang/2010. The ITAT by its order dated 05.07.2017 partly allowed the appeal and directed the Assessing Officer to frame the assessment order in the hands of the amalgamated Company namely the assessee. Feeling aggrieved, the assessee has filed this appeal.
"(a) That the Hon'ble Tribunal was right in rejecting the Appellant's contention that the assessment order passed on LGSPL, which was non-existent as on the date of the order, was invalid, holding that at the time of issue of the notice under Section 143(2) of the Act, the amalgamating company was in existence, although the same is contrary to the decisions of
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the jurisdictional High Court and various other High Courts?
(b) That the Hon'ble Tribunal was justified in remitting the matter back to the file of the 1st respondent to pass fresh order on the amalgamated company despite the time limit for doing so in terms of Section 153 of the Act having expired?"
1 [2015] 57 taxmann.com 159 (Karnataka)
2 2012 (280) ELT 43 (Del.)
3 [2019] 107 taxmann.com 375 (SC)
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under Section 143(2) of the Income Tax Act ('Act' for short) was issued in the name of amalgamating Company. Under such circumstance, the Court has passed order in that case.
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Enfotainment Ltd.,4 has been upheld dismissing the Civil Appeal filed by CIT. Similarly, the order passed by this Court in Intel Technology India (P) Ltd. (supra) was also challenged before the Hon'ble Apex Court and the same has also been dismissed in Civil Appeal No.6581 of 2015.
consideration and hence, the following:
ORDER
The appeal is allowed.
The substantial questions of law are answered in favour
of the assessee and against the revenue.
Sd/JUDGE
Sd/JUDGE
*bgn/-
4 Civil Appeal No.285/2014 DD 02.11.2017
2 issues framed by the court
Whether an assessment order passed on a non-existent amalgamating company is invalid contrary to the presence at the time of notice issuance?
Whether remittal of the matter to the Assessing Officer to pass a fresh order on the amalgamated company is justified despite the expiry of the time limit under Section 153?
Colour shows how this judgement treated each authority
Commissioner of Income Tax, Central Circle, Bangalore Vs Intel Technology India (P) Ltd.Referred¶32
[2015] 57 taxmann.com 159 (Karnataka)
Spice Entertainment Ltd., Vs Commissioner of Income TaxReferred¶32
2012 (280) ELT 43 (Del.)
Principal Commissioner of Income Tax Vs Maruti Suzuki India Ltd.Referred¶32
[2019] 107 taxmann.com 375 (SC)
C.I.T. New Delhi Vs M/s Spice Enfotainment Ltd.Distinguished¶8
C.I.T. New Delhi Vs M/s Spice Enfotainment Ltd.
3 provisions across 1 enactments
Logica Pvt. Ltd.
Assistant Commissioner of Income-Tax
Principal Commissioner of Income Tax
P.S. Dinesh Kumar
M.G. Uma
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
